A R100 note goes less and less at the pump as rising fuel prices continue to strain South African households, despite a temporary levy reduction.. Picture Credit: TopAuto
By AIsha Zardad
South Africa — Government has announced a temporary reduction in the fuel levy in an effort to ease pressure on consumers facing steep fuel price increases driven by global instability.
In a joint statement, Finance Minister Enoch Godongwana and Mineral and Petroleum Resources Minister Gwede Mantashe confirmed that a R3 per litre cut to the fuel levy will be implemented as an immediate relief measure.
The intervention comes amid significant turbulence in global oil markets, linked to escalating tensions in the Middle East and disruptions along the Strait of Hormuz — developments that have intensified pressure on domestic fuel prices.
The ministers warned that the worsening geopolitical situation has materially increased risks to global energy supply, driving up costs for South African consumers.
“Consultations have been held between the National Treasury and the DMPR to explore measures to provide short-term relief to consumers, while maintaining a stable and sustainable fuel supply system,” the joint statement from the ministers read.
Despite the relief measure, fuel prices are still set to rise sharply. Petrol will increase by R3.06 per litre across both grades, while diesel will climb by between R7.37 (500ppm) and R7.51 (50ppm). Illuminating paraffin is expected to surge by R11.67 per litre.
From Wednesday, 1 April, motorists will pay R22.53 per litre for 95 Unleaded petrol at the coast and R23.36 inland, with 93 Unleaded reaching R23.25 inland. The wholesale price of 50ppm diesel will rise to R25.35 at the coast and R26.11 in Gauteng.
National Treasury estimates the levy reduction will cost the fiscus approximately R6 billion per month. Government indicated that the intervention will be reviewed monthly over the next two months.
“The relief measure is designed to be fiscally neutral, and the government will implement mechanisms to recoup the foregone revenue within the fiscal framework approved during the 2026 Budget,” the ministers said.
Authorities also moved to calm fears of supply shortages, assuring the public that the country has sufficient fuel reserves to meet current and anticipated demand.
“Work is underway on a broader package of measures to support households and key sectors of the economy. Further details on additional support measures will be announced in due course. Government remains committed to balancing economic sustainability with the need to protect consumers,” the statement further read.
The announcement has drawn mixed reactions from labour groups and industry bodies.
The Motor Industry Staff Association (MISA) welcomed the move, saying it reflects that government has responded to calls for intervention.
MISA’s CEO of operations, Martlé Keyter, warned of the mounting pressure on households:
“Workers are being crushed between the rising cost of fuel and electricity. Families are forced to choose between commuting to work, putting food on the table, or keeping the lights on. This is not sustainable.”
The union also pointed to Namibia’s decision to temporarily cut fuel levies by 50% as an example South Africa could follow to provide further protection for consumers.
From an industry perspective, the South African Petroleum Retailers Association (SAPRA) sought to reassure motorists amid reports of long queues and fuel shortages ahead of the price adjustment.
Chairperson Henry van der Merwe said the strain is being driven by panic buying rather than a lack of supply.
“We are aware of increasing reports of queues and some sites running low on fuel, particularly diesel, in the lead-up to the anticipated price adjustment. It is important to stress that this is not due to a shortage of product in the country, but rather a short-term strain on distribution caused by a surge in demand as consumers rush to fill up ahead of the increase,” van der Merwe said.
“From a fuel retail perspective, our members are working around the clock to manage this heightened demand and ensure continuity of supply. SAPRA is in ongoing, daily engagement with the relevant government departments and industry stakeholders, and we can confirm that there is sufficient product in the system,” he added.
He further emphasised that service stations are not withholding fuel and that deliveries are continuing, with the system expected to stabilise once demand normalises.
Meanwhile, the Congress of South African Trade Unions (Cosatu) cautioned that the current intervention may not go far enough to shield vulnerable households.
“Whilst appreciating this effort to cushion society from the international oil price spike, we fear that workers, society and the economy will simply not cope with a R3 a litre hike for petrol and more worryingly a devastating R7 a litre hike for diesel and R11 for paraffin. Diesel is critical for the public transport that workers depend upon as is paraffin for millions of working-class families. Workers already drowning in debt, supporting up to 7 relatives each and spending an average of 40% of their meagre wages on transport; will not manage such painful diesel and paraffin, and even petrol price hikes.”
Cosatu warned that if global pressures persist, further intervention will be required, including adjustments to social grants, targeted food support, and measures to limit rising electricity and food costs.
“If the war drags on and inflation rises, additional relief should be put in place, in particular adjusting social and the SRD grants, delivering food parcels to social grant recipients, putting in place measures to protect food from inflation with targeted support for agriculture and Transnet, and engaging Eskom on measures to reduce the price of electricity. The Reserve Bank must spare society further pain by not increasing the repo rate as this source of inflation is external and not domestic driven and workers’ wages must be protected from further bleeding,” Cosatu further said.
